The Economic Times

Sale of renewable energy certificates (RECs) increased by about 62 per cent to 49.56 lakh this fiscal as compared to 30.64 lakh in 2014-15.

Similarly, the sale of RECs jumped by 87 per cent in March to 12.66 lakh compared to 6.76 lakh in February this year in monthly auction held yesterday.

Power distribution companies as well as open access and captive consumers are under obligation to buy RECs from renewable energy producers under the Renewable Energy Purchase Obligation (RPO) mandated by central/state regulatory commission.

Two power exchanges -- Indian Energy Exchange (IEX) and Power Exchange India Limited (PXIL), approved by the Central Electricity Regulatory Commission -- hold auction of RECs on the last Wednesday of every month.

With almost 7.10 lacs RECs traded in March REC Session at IEX held on March 30, 2016, the traded volume surged over 2.5 times over February, 2016. This is the second highest trade so far after December 2015 when 8.66 lakh RECs were traded, IEX said in a press statement.

It further said, "With Government of India placing huge emphasis on RPO compliance, obligated entities including Captive Power consumers, Open Access consumers and Discoms have come forward to comply with their RP Obligation."

In fiscal 2015-16, about 31.4 lakh RECs were traded at IEX, more than double of 15.5 lakh RECs traded last fiscal.

On an overall basis, 49.6 lacs RECs were traded on IEX and PXIL, an increase of about 62 per cent as compared to 30.6 lakh RECs traded last fiscal.

PXIL said, "The total cleared volume on the exchange was 5,56,648 RECs that led to PXIL having a Market Share of 43.96 per cent. This financial year total traded REC volume on the PXIL registered 19.94 per cent rise with 18,16,263 traded certificates compared to 15,14,298 certificates traded in FY 14-15, which led to PXIL achieving market share of 36.65 per cent."

Prior to today's auction there were more than 1.78 crore REC's available in the market for trade.

With implementation of UDAY scheme, the improved financial health of state distribution licensees will help in reducing the high inventory levels in the coming financial year, PXIL added.